Income Tax Authorities, Powers and Duties - Income Tax Laws | Income Tax Laws - B Com PDF Download

VARIOUS AUTHORITIES

Section of the Income Tax Act, 1961 provides for the administrative and judicial authorities for the administration of this Act. The Direct Tax Laws Act, 1987 has brought far-reaching changes in the organizational structure. The implementation of the Act lies in the hands of these authorities. The change in designation of certain authorities and creation of certain new posts in the structure are the main features of amendments made by The Direct Tax Laws Act, 1987. The new features of authorities have been properly depicted in a chart on the facing page. These authorities have been grouped into two main wings :

(i) Administrative [ Income Tax Authorities ][ Sec. 116 ]

(a) the Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963 (54 of 1963),
(b) Directors-General of Income-tax or Chief Commissioners of Income-tax,
(c) Directors of Income-tax or Commissioners of Income-tax or Commissioners of Income-tax (Appeals),
1. (cc) Additional Directors of Income-tax or Additional Commissioners of Income-tax or Additional Commissioners of Income-tax (Appeals),
2. (cca) Joint Directors of Income-tax or Joint Commissioners of Income-tax.
(d) Deputy Directors of Income-tax or Deputy Commissioners of Income-tax or Deputy Commissioners of Income-tax (Appeals),
(e) Assistant Directors of Income-tax or Assistant Commissioners of Income-tax,
(f) Income-tax Officers,
(g) Tax Recovery Officers,
(h) Inspectors of Income-tax.

"Assessing Officer" means the Assistant Commissioner or Deputy Commissioner or Assistant Director or Deputy Director or the Income-tax Officer who is vested with the relevant jurisdiction by virtue of directions or orders issued under sub-section (1) or sub-section (2) of section 120 or any other provision of this Act, and the Joint Commissioner or Joint Director who is directed under clause (b) of sub-section (4) of that section to exercise or perform all or any of the powers and functions conferred on, or assigned to, an Assessing Officer under this Act;

Importance of Assessing Officer :
In the organizational setup of the income tax department, Assessing Officer plays a very vital role. He is the primary authority who initiates the proceedings and is directly connected with the public. From the time of filing of return till the assessment is completed he plays a pivotal role. He can start proceedings for non-filing of return, imposition of penalties etc. Orders passed by him can be challenged only on approval. The department can revise his orders only if it is proved that there are prejudicial to the revenue and that too only by the Commissioner of Income Tax.

(1) Power of Central Government: The Central Government may appoint such persons as it thinks fit to be income-tax authorities. It kept with itself the powers to appoint authorities upto and above the rank of an Assistant Commissioner of Income-Tax [ Sec. 117 (1) ]

(2)  Power of the Board and Other Higher Authorities:  Subject to the rules and orders of the Central Government regulating the conditions of service of persons in public services and posts, the Central Government may authorize the Board, or a Director-General, a Chief Commissioner or a Director or a Commissioner to appoint income-tax authorities below the rank of an Assistant Commissioner or Deputy Commissioner.  [ Sec. 117 (2) ]

(3) Power to appoint Executive and Ministerial Staff:  Subject to the rules and orders of the Central Government regulating the conditions of service of persons in public services and posts, an income-tax authority authorized in this behalf by the Board may appoint such executive or ministerial staff as may be necessary to assist it in the execution of its functions.

(4)  Control of Income-Tax Authorities [ Sec. 118 ]

The Board may, by notification in the Official Gazette, direct that any income-tax authority or authorities specified in the notification shall be subordinate to such other income-tax authority or authorities as may be specified in such notification.

Income Tax Authorities and their Powers

The Government of India has constituted a number of authorities to execute the Income Tax Act and to control the Income Tax Department efficiently.
The Central Board of Direct Taxes is the supreme body in the direct tax set-up. It has to perform several statutory functions under the various acts and it is responsible for the formulation and implementation of different policies relating to direct taxes administration. The Board consists of a Chairman and six members.

Appointment of Income Tax Authorities in India

The Central Government can appoint those persons who it thinks are fit to become Income Tax Authorities. The Central Government can authorize the Board or a Director-General, a Chief Commissioner or a Commissioner or a Director to appoint income tax authorities below the ranks of a Deputy Commissioner or Assistant Commissioner, According to the rules and regulations of the Central Government controlling the conditions of such posts.
 

Powers of Income Tax Authorities

1) Power relating to Discovery, Production of evidence, etc: The Assessing Officer, The Joint Commissioner, The Chief Commissioner or the Commissioner has the powers as are provided in a court under the code of Civil Procedure, 1908 when trying to suit for the following matters:

(a) discovery and inspection;
(b) to enforce any person for attendance, and examining him on oath;
(c) issuing commissions; and
(d) compelling the production of books of account and another document.

2) Power of Search and Seizure: Today, it is not hidden from income tax authorities that people evade tax and keep unaccounted assets. When the prosecution fails to prevent tax evasion, the department has to take actions like search and seizure.

3) Requisition of Books of account, etc: Where the Director or the Director-General or Commissioner or the Chief Commissioner in consequence of information in his possession, has reason to believe that (a), (b), or (c) as mentioned under section 132(1) and the book of accounts or other documents or the assets have been taken under custody by any authority or officer under any other law, then the Chief Commissioner or the Director-General or Director or Commissioner can authorize any Joint Director, Deputy Director, Joint Commissioner, Assistant Commissioner, Assistant Director, or Income-tax Officer to require the authority to provide such books of account, assets or any documents to the requisitioning officer when such officer thinks that it is no longer necessary to retain the same in his custody.

4) Power to Call for Information: The Commissioner, The Assessing Officer or the Joint Commissioner may for the purpose of this Act:

(a) can call any firm to provide him with a return of the addresses and names of partners of the firm and their shares;
(b) can ask any Hindu Undivided Family to provide him with the return of the addresses and names of members of the family and the manager;
(c) can ask any person who is a trustee, guardian or an agent to deliver him with the return of the names of persons for or of whom he is an agent, trustee or guardian and their addresses;
(d) can ask any person, dealer, agent or broker concerned in the management of stock or any commodity exchange to provide a statement of the addresses and names of all the persons to whom the Exchange or he has paid any sum related to the transfer of assets or the exchange has received any such sum with the particulars of all such payments and receipts;

6) Collection of Information: For the purpose of collection of information which may be useful for any purpose, the Income-tax authority can enter any building or place within the limits of the area assigned to such authority, or any place or building occupied by any person in respect of whom he exercises jurisdiction.